‘General’ Category

Volatility and Downside Movement in the Asian Market

February 10th, 2011

Individual Asian markets are progressing shakily, and their future success depends on the central banks’ response to inflation. Figures have shown that in India, the wholesale price index has risen 8.43%, after a 7.48% increase in the previous year. South Korea and Thailand have decided to increase borrowing costs, and India might do the same.

The MSCI Asia Pacific Index was increased by 1.0% to 139.46, while the FTSE Asia Pacific Index 235.49 fell 1.5% in the same week. The rise of the euro against the dollar is responsible for the change in figures.

China, India and Hong Kong have been responsible for much less volatility in the past few months. In fact, volatility is spreading, and downside is moving along with it. The relationship between volatility and downside movement is growing stronger, especially in the Asian market.